Apple on May 1, 2026, said that strong demand for its newly launched iPhone 17 lineup and the budget MacBook Neo is powering a more robust-than-expected sales forecast, even amid persistent chip supply constraints and rising memory costs, according to Reuters as reported by The Indian Express.
Growth Outlook and Supply Chain Pressures
The company projects sales growth of 14–17% in its fiscal third quarter—well above the 9.5% increase Wall Street had estimated, Reuters data shows, per The Indian Express.
Still, Apple cautions that memory chip costs will significantly impact margins beyond the June quarter, and acknowledged continuing tightness in chip supplies. Some sources indicate advanced processor shortages may be affecting iPhone 17 family production, though details remain limited.
Products at the Core of Resilience
The MacBook Neo, priced around $500 for students, contributed to Mac sales of $8.4 billion in the quarter, beating analyst estimates of $8.02 billion. Apple is reportedly using “binned” A18 Pro chips—originally processed for the iPhone 16 Pro models—with one disabled GPU core to power the Neo. This efficient reuse helped manage supply pressures and cost, as noted by Reuters.
Demand for MacBook Neo has been so strong that sources such as MacRumors and TechSpot report Apple may exhaust its supply of these binned A18 Pro chips before transitioning to a refreshed Neo built around A19 Pro chips.
Memory Cost Pressures
Apple benefited from existing memory chip inventory to deliver a gross margin of approximately 49.27% last quarter—above estimates of 48.38%. However, the company forecasts a contraction to 47.5–48.5% in the upcoming quarter, with rising memory costs becoming increasingly burdensome, according to Reuters.
Meanwhile, broader industry analysis from Tom’s Hardware highlights surging DRAM and NAND prices—some rising by over 90% quarter-over-quarter—driven by demand from AI infrastructure, further squeezing component costs.
Implications and Outlook
This situation underscores Apple’s adaptability: leveraging legacy chip inventory, delivering on lower-cost hardware through vertical integration, and riding resilient demand in smartphones and education-oriented hardware.
However, continued margin pressure from memory cost inflation and chip scarcity, coupled with high product demand exerting strain on supply chains, pose risks to sustained growth. Industry observers suggest that Apple’s ability to transition smoothly to A19 Pro–based Neo models and manage memory cost pressures will be pivotal.
Conclusion
Apple’s upbeat growth forecast, buoyed by the iPhone 17 and MacBook Neo, reflects the company’s ability to navigate supply-side challenges through strategic product deployment. Yet the evolving memory cost environment and chip shortages remain critical headwinds that Apple must address in the coming quarters.